McKinney, Texas, Reverse Mortgage Loans

Meet Michael Inkman and the Inkman team, your licensed reverse mortgage specialists in McKinney, Texas.

Reverse mortgage loans are a popular financial option for senior homeowners in McKinney, Texas, offering access into their home’s equity.

In this article, we will be discussing the Federal Housing Authority (FHA)-insured Home Equity Conversion Mortgage (HECM) loan. Unless stated otherwise, we’ll be referring to HECMs when we talk about reverse mortgage loans.

What is a Reverse Mortgage Loan?

Reverse mortgage loans allow homeowners aged 62 and above to access their home equity without the obligation of monthly mortgage payments, as long as the borrower pays property-related expenses such as insurance, taxes and maintenance.

Seniors residing in McKinney, Texas, who want to remain in their homes while securing additional financial flexibility may benefit greatly from a reverse mortgage loan. The funds from a reverse mortgage loan can be used for anything the borrower desires, such as medical bills, home enhancements or vacations.

Our Reverse Mortgage Loans in McKinney, Texas

Home Equity Conversion Mortgages (HECMs)

HECMs are the only reverse mortgage loans insured by the Federal Housing Administration (FHA) and are the most common. It allows homeowners who are 62 years of age or older to convert a portion of their home equity into cash. Because the cash is considered loan proceeds and not income, it is tax-free.*

Borrowers can elect to receive their proceeds in several ways, including lump sum, line of credit and monthly payments. As the FHA insures them, HECMs are non-recourse loans, meaning the homeowners or their heirs will never owe more than the home’s market value at the time of sale.**

HECM for Purchase (H4P)

The H4P reverse mortgage loan allows seniors to purchase a new home using the equity from the sale of their previous home, which can greatly increase their buying power (sometimes up to 200%)!

The increased purchasing power enables many seniors to move to more expensive homes and areas than they could otherwise afford. The homeowner doesn’t need to make monthly mortgage payments on their new home. Instead, they just have to take care of property charges like taxes, insurance and upkeep. As a bonus, if the home’s value appreciates over time and exceeds the amount borrowed at the time of sale, the homeowners or their heirs may receive the remaining equity.

Jumbo Reverse Mortgage Loan

Jumbo reverse mortgage loans are designed for high-value homes. With a HECM, the FHA limits the amount that you can borrow against the home to $1,089,300. So for homes worth more than the FHA limit, a traditional HECM could leave a lot of money on the table.

With a jumbo reverse mortgage, the homeowner can borrow against the home’s total value, potentially significantly increasing their proceeds from a reverse mortgage loan.

Benefits of Reverse Mortgage Loans

Flexible Monthly Payments

Unlike a traditional mortgage, reverse mortgage loans do not require monthly mortgage payments. However, the homeowner will still have to cover property-related expenses such as insurance, taxes and home upkeep. The loan balance will become due when the homeowner sells the property, moves out or passes away.*

Borrowers can choose to receive their funds as a lump sum, line of credit, monthly payments or combination with FHA insuring.

Potential for Home Value Appreciation

McKinney, Texas, boasts a growing real estate market, allowing borrowers to capitalize on increasing property values over time. As the home’s value appreciates, so does the available equity, which may lead to a larger payout over the life of the loan.

Aging in Place

Reverse mortgage loans can provide the funds that many seniors need to age more comfortably in their homes. Seniors typically use their loan proceeds to renovate their homes, make repairs they’ve been putting off or even to fund their long-term care (LTC) plans.

Supplemental Retirement Cash Flow

A reverse mortgage loan can provide a reliable source of tax-free** cash flow to supplement Social Security, pensions or other retirement savings, allowing homeowners to sustain their quality of life and cover living expenses during retirement.**

Non-Recourse Loan Protection

HECMs are the only reverse mortgage loans insured by the Federal Housing Administration (FHA). This makes HECMs non-recourse loans, meaning the borrower will never owe more than the home is worth at the time of sale.*

For example, suppose a borrower takes a reverse mortgage loan on their home when the housing market is high. The market is low when they pass away, but their heirs still wish to sell the property. In that case, the Mutual Mortgage Insurance Fund pays the remaining difference (administered by the FHA and financed via Mortgage Insurance Premiums paid by all borrowers). This offers great peace of mind to those concerned about passing debts onto heirs.

Qualifying for a Reverse Mortgage in McKinney, Texas

To be eligible for a reverse mortgage in McKinney, Texas, you must typically meet the following requirements:

Age: The borrower must be 62 or older.
Home Ownership: The borrower must own the home, and it must be their primary residence. Reverse mortgages are not available for vacation homes or investment properties.
Equity: The borrower must have significant equity in the home or own it outright.
Financial Capacity: The borrower must be able to pay property taxes, homeowners insurance and other property charges.
Counseling: The borrower must receive counseling from a U.S. Dept. of Housing and Urban Development (HUD)-approved counselor on the terms and obligations of the loan.

Exploring McKinney, Texas

McKinney, Texas, located north of Dallas, blends history with modern growth. As Collin County’s seat, its downtown retains a historic feel with shops and eateries. The city offers contemporary amenities like shopping centers and recreation, along with a growing arts scene. There are spaces to enjoy nature, including parks, trails and community gardens.

Seniors in McKinney, Texas find convenience and engagement. The city offers amenities like community centers, healthcare and parks for an active lifestyle. Both historic and modern areas provide shopping and dining options. Events and activities foster community connections. Overall, McKinney supports seniors in their retirement years.

Intriguing Facts About McKinney

McKinney is home to the historic McKinney Flour Mill, which dates back to 1874 and is one of the oldest operating flour mills in Texas.
The Chestnut Square Historic Village in McKinney preserves and showcases historic buildings, offering visitors a glimpse into the city’s past.
The city’s thriving arts scene is evident through various galleries, public art installations and cultural events that contribute to McKinney’s creative atmosphere.
McKinney has its share of ghost stories, with tales of supernatural occurrences around the historic downtown and even spooky tours offered during Halloween.
The McKinney National Airport is also known for its annual airshow, showcasing aircraft displays and aerobatic performances.
McKinney is known as the Christmas Capital of Texas due to its impressive number of holiday festivities, including a tree lighting ceremony, parades and a historic home tour during the Christmas season.

Exploring Reverse Mortgage Loan Possibilities in McKinney?

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*There are some circumstances that will cause the loan to mature and the balance to become due and payable. Borrower is still responsible for paying property taxes and insurance and maintaining the home. Credit subject to age, property and some limited debt qualifications. Program rates, fees, terms and conditions are not available in all states and subject to change. **This advertisement does not constitute tax or financial advice. Please consult a tax and/or financial advisor regarding your specific situation.